Labor has denounced the move for a super-sized homeland security ministry, calling the Turnbull government's consideration of the idea "deeply concerning" and a "power grab" by Immigration Minister Peter Dutton.

Shadow attorney-general Mark Dreyfus said the mooted reorganisation of Australian intelligence, border security and law enforcement had been "proposed and killed off by the Liberal Party before", and was unnecessary because agencies already worked together effectively.

There are two models that have been mentioned in association with the proposal: the Department of Homeland Security in the United States, which merged 22 federal agencies; and Britain's Home Office, a smaller co-ordinating body.

Mr Dutton, who last month laid out the case for the US-style change, is understood to be the chief cabinet backer of amalgamation. A new department would be built out of his Department of Immigration and Border Protection, stripping responsibilities from George Brandis' Attorney-General's Department.

"This is an obvious power grab by Peter Dutton," Mr Dreyfus said on Thursday. "Australians should be concerned that national security is being used as the latest battleground for the Liberal Party to play out its internal divisions.

"As a number of reviews in recent years have shown, our intelligence and enforcement agencies work extremely well together, and do a great job keeping Australians safe. Any case for change must be made on the basis that it is in Australia's best security interests – the government has not made such a case."

Fairfax Media reported in March that a reorganisation was being considered and that Mr Dutton looked likely to become the minister in charge if the agencies were merged.

Advocates argue there is poor co-operation between agencies, but some ministers and officials have dismissed the move as militarisation and "empire building" on the part of Mr Dutton and Department of Immigration and Border Protection Secretary Michael Pezzullo.

Senator Brandis, Foreign Minister Julie Bishop and Defence Minister Marise Payne – as well as the Australian Federal Police and Australian Security Intelligence Organisation – are understood to oppose amalgamation.

A reorganisation had also been considered by former Labor prime minister Kevin Rudd, but the proposal was killed off.

The Daily Telegraph reported on Thursday that the creation of a new homeland security portfolio, with Mr Dutton benefiting, would be announced when Prime Minister Malcolm Turnbull reshuffles his ministry and moves Senator Brandis on.

Strongly rejecting the proposal for the first time since Mr Turnbull came to power in late 2015, Mr Dreyfus said the Prime Minister should "stop Peter Dutton's obsession with power getting in the way of keeping Australians safe".

It pointed to the British template – overseen by a minister for home affairs – as a "small, flexible, co-ordinating" body that would avoid bureaucratic sluggishness and "provide leadership and co-ordination to its portfolio agencies".

Asked this week about the continuing reports of a reorganisation, Mr Dutton said it was an issue for the Prime Minister, and the government was keen to do whatever it could to combat terror threats.